It sounds like a heater core issue (leak). The odor will vent outside through the air vent system.

JLP

Okay, any handy hints how to remove heater core easily? Gonna start to tear it apart tommorrow.

Take your time. If the screws come out easy it looks like you can take the heater-core out with removing the box I have not tried this, because it needed paint so I've always taken the whole unit out. If you remove the blower you can access the side that pulls off. You might want to remove the glove box it gives a lot more room. I'd recommend removing the whole unit and giving it a coat of paint if you see bare metal it will rust quickly. If you need to remove the whole unit be prepared to pull up the dash.

Why not bypass the heater core and see if the smell goes away before you go tearing into that PITA job? I have tackeled that task on my 73 and it was no fun at all. Hate to see you go through that for nothing.

How do i bypass it? Im not going to tear the whole dash apart for sure...

When i start the car, exhaust is white but when it warms up its colourless..

Koalia. If you have steam coming from your exhaust in any quantity, and also water,

it could be indicating a head gasket leaking water into a cylinder.

I found the leak in heater, seems to leak from either the upper or lower or both. The lower is easy to replace but the upper is molded.. So i better make an order to MSA or is there any other source?

It dumps water only when radiator is topped, maybe its the cap thats broken. Steam in any quantity... so there can be NO exhaust steam at all?

You might want to go ahead and replace the heater control valve while you are there.

JLP

White "smoke" in cold weather is just steam. When gasoline ignites it produces quite a bit of heat. When the fuel ignites it results in carbon dioxide and water vapor. As water vapor cools in the exhaust pipe it forms small droplets that are visible in the form of steam vapor. That's the white "smoke". Once the exaust pipe warms up sufficiently, the exhaust leaving the pipe is still hot enough that the water vapor hasn't formed the droplets and dissipates quickly enough that you don't see the vapor. On the other hand, if it's truly white smoke, with that burnt or hot antifreeze smell, it could be a head gasket, if it's light blue or blue-grey smoke and it doesn't stop when the exhaust pipe warms up, that's oil vapor and a sign of bad rings and/or valve stem seals.

Thing is, that the exhaust smells like it should BUT the engine bay doesnt. That smell does not come from vents from inside but the opposite. Its lot stronger outside car.

I'd also add to JLP's suggestion new hoses. especially since you can get them with the braided wrap on the outside right now. The end are starting to curl and the rubber looks like it is dried out. The heater box looks like it may also need a coat of paint also.

I replaced that hose and it might have reduced the stink about 20%. One of the few 240z owners here said that the problem could be caused by the carb/manifold gasket, he had changed head gasket for 3 times in his car until he found out the problem..